05 January 2015, Lagos – Mart Resources, Midwestern Oil and Gas Company Limited, SunTrust Oil Company Limited and other third parties that utilise Shell-operated Trans Forcados Pipeline have urged the oil giant to disclose the pipeline losses on the export pipeline to enable the companies estimate their individual losses.

*Shell.

Mart Resources and Sun Trust Oil Company Limited are co-venturers with Midwestern Oil and Gas Company Limited in Umusadege Field, which is operated by Midwestern and delivers crude oil for export through the Trans Forcados Pipeline to the Forcados Export Terminal.

Apart from Mart Resources and its partners, Seplat Petroleum Development Company; Pan Ocean Corporation and the NPDC, a subsidiary of NNPC also transport their crude oil through the forcados pipeline.

In its updates on Umusagede Field released at the weekend, Mart Resources noted an absence of accurate and reconcilable injection data from Shell Petroleum Development Company of Nigeria Limited (SPDC), the operator of the Trans Forcados oil export terminal system.

According to the company, the other companies have only received unreconciled reports that include only preliminary gross oil injection volumes and estimated pipeline and export facility losses.

“From our initial review, it is not clear whether the reported volumes represent all producers on the system or only Mart and its co-venturers. Mart and its co-venturers have requested additional and more complete information from SPDC in order to accurately reconcile volumes and any attributed pipeline losses. However, based upon preliminary analysis of the volume and loss information provided, Mart has calculated that the average loss rate could range between 10 per cent and 21 per cent of gross oil injections,” said the company.

Mart insisted that it is currently not able to obtain confirmation of these values, adding that it is also not able to perform a reliable reconciliation until more accurate and complete information and reports can be obtained from SPDC.

The company said in the absence of reliable and accurate reports from Shell, it will continue to estimate such pipeline losses at a rate of 10 per cent based upon historic pipeline losses encountered by other exploration and production companies utilising theTrans Forcados export system.

It further stated that based upon its internal production and facility data, theUmusadege field deliveries into the Trans Forcados export pipeline connected to the Forcados oil export terminal were approximately 419,170 barrels in November 2015.

Based upon historic pipeline losses encountered by other exploration and production companies utilising the Trans Forcados export system, Mart estimates pipeline and export facility losses of 10 per cent of crude oil deliveries, resulting in estimated Umusadege field deliveries of approximately 41,920 barrels for November 2015 after deduction of estimated pipeline and export facility losses.

The production updates further revealed that the total net crude oil deliveries into the Nigerian Agip Oil Company (NAOC) export pipeline from the Umusadege field for November 2015 were approximately 177, 640 barrels before pipeline losses.

The company stated that based upon the 12-month rolling average rate of pipeline and export facility losses from December 2013 to November 2014 of 17.46 per cent, Mart estimates NAOC export pipeline and Brass River export facility losses for November 2015 will be approximately 31,010 barrels.

“Accordingly, Mart estimates that the total net crude deliveries into the NAOC export pipeline from the Umusadege field for November 2015 less estimated pipeline losses will be approximately 146,630 barrels,” the company added.